The main objective of this report is to analysis Human Resource Management Practice in Social Marketing Company. Other objectives are evaluate and analyze the existing HRM system of SMC and find out the recruitment and selection procedure and its practices. Here also find out the training and development procedure and find out the acceptability and reliability of the performance appraisal system. Finally provide recommendation on some effective measures in improving HR practices of SMC.
Objectives of the study
- To attain practical knowledge of organizational HR system, HRM areas and its management practices.
- To get an overview of the human Resource Management system of SMC.
- To evaluate and analyze the existing HRM system of SMC.
- To find out the recruitment and selection procedure and its practices in SMC.
- To find out the training and development procedure in SMC.
- To find out the acceptability and reliability of the performance appraisal system.
- Lastly to provide recommendation on some effective measures in improving HR practices of SMC.
Methodology of the study
Methodology can be defined as a body of practices, procedures, and rules used by those who work in a discipline or engage in an inquiry; a set of working methods. The methodology used in our study was exploratory in nature. We used both primary and secondary sources of data. Among the primary sources of data, the employee questionnaire served the most in our analysis of the HRM department of SMC. Most of our findings resulted from the employee questionnaire and personal observation. Among the secondary sources, different HRM textbooks, the internet and the SMC service rule book was used mostly. Below primary sources and secondary sources of data are listed below:
Primary Sources of data:
- Personal & depth interview
- Through questionnaire
- Practical deskwork
- Observation in the organization
Secondary Sources of Data:
- Service rule
- Different reports & publications
- HRM books
- SMC website
- Performance records
- Training records
- Lectures Notes
Scope of Human Resource Management
Human resources are undoubtedly the key resources in an organization, the easiest and the most difficult to manage! The objectives of the HRM span right from the manpower needs assessment to management and retention of the same. To this effect Human resource management is responsible for effective designing and implementation of various policies, procedures and programs. It is all about developing and managing knowledge, skills, creativity, aptitude and talent and using them optimally.
It also focuses on managing physical and emotional capital of employees. Considering the intricacies involved, the scope of HRM is widening with every passing day. It covers but is not limited to HR planning, hiring (recruitment and selection), training and development, payroll management, rewards and recognitions, Industrial relations, grievance handling, legal procedures etc. It’s about developing and managing harmonious relationships at workplace and striking a balance between organizational goals and individual goals.
The scope of HRM is extensive and far-reaching. Therefore, it is very difficult to define it concisely. However, I try to classify the same under following heads:
- HRM in Personnel Management: This is typically direct manpower management that involves manpower planning, hiring (recruitment and selection), training and development, induction and orientation, transfer, promotion, compensation, layoff and retrenchment, employee productivity.
- HRM in Employee Welfare: This particular aspect of HRM deals with working conditions and amenities at workplace. This includes a wide array of responsibilities and services such as safety services, health services, welfare funds, social security and medical services. It also covers appointment of safety officers, making the environment worth working, eliminating workplace hazards, support by top management, job safety, safeguarding machinery, cleanliness, proper ventilation and lighting, sanitation, medical care, sickness benefits, employment injury benefits, personal injury benefits, maternity benefits, unemployment benefits and family benefits.
- HRM in Industrial Relations: Since it is a highly sensitive area, it needs careful interactions with labor or employee unions, addressing their grievances and settling the disputes effectively in order to maintain peace and harmony in the organization. It is the art and science of understanding the employment (union-management) relations, joint consultation, disciplinary procedures, solving problems with mutual efforts, understanding human behavior and maintaining work relations, collective bargaining and settlement of disputes.
The main aim is to safeguarding the interest of employees by securing the highest level of understanding to the extent that does not leave a negative impact on organization. It is about establishing, growing and promoting industrial democracy to safeguard the interests of both employees and management.
Processes in Human Resource Management:
Each organization works towards the realization of one vision. The same is achieved by formulation of certain strategies and execution of the same, which is done by the HR department. At the base of this strategy formulation lie various processes and the effectiveness of the former lies in the meticulous design of these processes.
The following are the various HR processes:
- Human resource planning (Recruitment, Selecting, Hiring, Training, Induction, Orientation, Evaluation, Promotion and Layoff).
- Employee remuneration and Benefits Administration
- Performance Management.
- Employee Relations.
Human Resource Planning
Generally, we consider Human Resource Planning as the process of people forecasting. Right but incomplete! It also involves the processes of Evaluation, Promotion and Layoff.
- Recruitment: It aims at attracting applicants that match a certain Job criteria.
- Selection: The next level of filtration. Aims at short listing candidates who are the nearest match in terms qualifications, expertise and potential for a certain job.
- Hiring: Deciding upon the final candidate who gets the job.
- Training and Development: Those processes that work on an employee onboard for his skills and abilities up gradation.
Employee Remuneration and Benefits Administration:
The process involves deciding upon salaries and wages, Incentives, Fringe Benefits and Perquisites etc. Money is the prime motivator in any job and therefore the importance of this process. Performing employees seek raises, better salaries and bonuses.
It is meant to help the organization train, motivate and reward workers. It is also meant to ensure that the organizational goals are met with efficiency. The process not only includes the employees but can also be for a department, product, and service or customer process; all towards enhancing or adding value to them.
Nowadays there is an automated performance management system (PMS) that carries all the information to help managers evaluate the performance of the employees and assess them accordingly on their training and development needs.
Employee retention is a nuisance with organizations especially in industries that are hugely competitive in nature. Though there are myriad factors that motivate an individual to stick to or leave an organization, but certainly few are under our control.
Employee relations include Labor Law and Relations, Working Environment, Employee heath and safety, Employee- Employee conflict management, Employee- Employee Conflict Management, Quality of Work Life, Workers Compensation, Employee Wellness and assistance programs, Counseling for occupational stress. All these are critical to employee retention apart from the money which is only a hygiene factor.
All processes are integral to the survival and success of HR strategies and no single process can work in isolation; there has to be a high level of conformity and cohesiveness between the same.
SMC At a glance
SMC is regarded as the largest privately-managed not-for-profit organisation in the world for a single country. The Company is registered under the Companies Act, 1913 in Bangladesh and is governed by a voluntary Board of Directors.Social marketing in Bangladesh was initiated to challenge the rapid population growth by marketing contraceptive products widely accessible at a price affordable to the general population and bring about behavioural change through extensive mass promotion
SMC is now regarded as a significant contributor to the reproductive and child health services in Bangladesh by complementing the public sector distribution with private sector social marketing model. In 2011, SMC provided 3.49 million Couple Years of Protection (CYP) through offering three modern methods – oral pills, condoms and injectables. As BDHS shows, 35 per cent of the modern contraceptive users reported that they use SMC brands.
The new WHO formula-based packaged oral rehydration salt brand marketed by SMC called ORSaline-N was introduced in 2004.With the objective of becoming self-sufficient and receiving uninterrupted supply of ORSaline-N, SMC’s factory began its operation in August 2004 at Bhaluka, Mymensingh. Currently, the annual production capacity of the factory is 210 million sachets.
SMC is one of the pioneers of social and market research in Bangladesh. Every year, SMC sponsors and conducts a number of research studies to gather empirical data and necessary information in developing and evaluating its various projects and activities.
In 1990, the Family Planning and Social Marketing Project transformed into a not-for-profit private (Ltd.) company, which gave it a more comprehensive legal framework for operational flexibility. The Company is now governed by a voluntary Board of Directors. The Board of Directors consist of eminent personalities with private and public sector expertise in different fields.
Social Marketing Company (SMC), Bangladesh is dedicated to providing opportunities for better family health for the people of our country by addressing issues of social priority.
SMC’s Vision to be the international model for sustainable social marketing built on the principles of cross subsidy using surplus funds from company’s business operations to support an expanded portfolio of program activities designed to achieve social good.
SMC’s Mission is to improve the health and well being of women, childer and families by increasing demand for an expanding access to products and services in family planning, health, nutrition and other socially beneficial areas in partnership with the private sector, government and the donors.
SMC aims to become a more results oriented organization with a more efficient management structure, more open communication channels at all levels, sounder financial management and planning capabilities, and a satisfying work environment for all its staff capabilities, and a satisfying work environment for all its staff.
SMC social markets a variety of oral pill brands (Combination 3, Noret-28, Femicon, Minicon and Femipil); and condoms (RAJA, HERO, Panther, Sensation, and U&ME); and clinical (Injectable “SOMA-JECT”) contraceptives.
The WHO formula-based packaged oral rehydration salt brand marketed by SMC called ORSaline-N was introduced in 2004. To provide choices to the consumers and to encourage children who are unwilling to take ORS, SMC introduced BNF-flavoured ORS brand ‘ORSaline Fruity’ in August 2003.
In May 2008, SMC introduced a micronutrient powder in the brand name of “MoniMix” to address childhood Iron Deficiency Anemia (IDA). It also started marketing Zinc dispersible tablets in September 2008 to reduce the severity of diarrhoea in children under 5. As part of its maternal and neonatal health programme, SMC launched Safe Delivery Kit branded as “Safety Kit” in 2008 to ensure clean child delivery at household level.
Hormonals: Oral Contraceptive Pill
|Maya||1975 – 1995|
|Ovacon||1980 – 1996|
|Norquest||1990 – 1995|
|Minicon||2000 – 2008|
|Majestic||1985 – 1989|
|ORSaline||1983 – 2004|
|Maternal Health Product:|
- Social Franchising – Blue Star program
- Health Communication Program
- Special Family Planning Campaign Program in Sylhet and Chittagong-“Shukh Pakhi”
- Tuberculosis (TB) Control Program
- Maternal and Neonatal Health Program (Jatone Raton)
- HIV/AIDS Prevention Programme – Modhumita
SMC’s objectives of programmatic and financial sustainability required that it function effectively as a not-for-profit private (Ltd.) company. Organizational structure is relatively flat and informal to enable the managers to quickly react to perceived opportunities.
SMC’s organizational structure reflects the following principles;
Authority and responsibility is delegated throughout the organization.
The structural location of a work unit is determined by its primary function and its relationship with other units.
Employees at each level are assigned responsibilities and accountabilities within specified jobs through their respective jobs description.
Organizational structure is organized around SEVEN divisions-
- Accounts & Finance Department
- Administration and HRM Department
- Marketing & Sales Department
- Credit Realization & Customer Care Department
- Purchase & Procurement Department
- Legal Department
- Planning, Research & Devolvement
The Accounts & Finance Department consists of and Accounts & Finance Department. A Chief Finance Office (FCO) who reports to the Chairman/ Managing Director/ Heads of the division.
The Administration and HRM Department consists of two department- Administration and Human Resource Management. A Department Head/ General Manager, Administration who reports to the Chairman/ Managing Director/ Heads of the department.
The Marketing & Sales Department consists of an area key strategic marketing functions organized and sales organization. A Department Head/ General Manager, Marketing & Sales who reports to the Chairman/ Managing Director/ Heads of the Department.
The Credit Realization & Customer Care Department consists of an area of Credit Realization and Customer Care. A Department Head/ General Manager, Credit Realization & Customer Care Division who reports to the Chairman/ Managing Director/ Heads of the department.
The Purchase & Procure Department consists of and Purchase & Procure Department. A Department Head/General Manager, Purchase and Procure Department who reports to the Chairman/Managing Director/ Heads of the department.
The Legal Department consists of and Legal Department. A Department Head/ General Manager, Legal Department who reports to the Chairman/ Managing Director/ Heads of the department.
Human Resource Management in SMC
SMC established itself as a leading non profit organization in Bangladesh.
It is continuing in accordance with the requirement of employment of labor standing orders act, 1965 and approved disciplinary procedures of the company. It is the duty of every employee to observe the following rules and to behave at all times in a reasonable way.
The recruitment, promotion, development and retention practices in SMC are based primarily on merit, potential and performance and on diversity that reflects, across the work force to achieve the mission. Policies and practices are stated clearly and in writing and made available to all employees.
SMC is committed to providing HR policies in line with the change environment and need of the organization.
In the SMC HRM service Ruler book and their Manual, all aspects of HRM Functions are described which includes Employment, Recruitment and selection, service and Efficiency rules, condition of employment. Promotion policy, Leave policy, Remuneration and Benefit, Performance management system and appraisal, Disciplinary procedures and others benefits.
Since this thesis only covers some practices of Human Resource Management of SMC, below only the rules and procedures regarding Recruitment, Training, Promotion,
Leave policy, Remuneration and Benefit and performance appraisal are discussed in detail.
The goal of the Human Resources policies of SMC is to have best possible staff and to retain them through continuous development. The organization recognizes the policy of equal employment opportunity for its employees who have the potential to enhance and utilize their skills and knowledge. SMC fully support the philosophy and belief of non-discrimination in employment.
Types of Employee Recruitment Policy
There are two types recruitment polices conduct in SMC.
Internal Recruitment- is a recruitment which takes place within the concern or organization. Internal sources of recruitment are readily available to an organization. Internal sources are primarily three –
- Promotions (through Internal Job Postings
- Re-employment of ex-employees
External Recruitment- External sources of recruitment have to be solicited from outside the organization. External sources are external to a concern.
The external sources of recruitment include-
- Employment at factory gate,
- Employment exchanges,
- Employment agencies,
- Educational institutes,
- Labor contractors,
- Recommendations etc.
CLASSIFIACATION OF EMPLOYEES
The company employs the following three types of employees:
Permanent employee: A person who has permanent employed against a permanent position and has satisfactory completed the required period of probation (bellow, section II.3) and has been employed against a permanent position. A “permanent position” is one that is not time bound and is likely to continue for as long as the company requires its function. The continued employment of a “permanent” employee is subject to annual review of (1) the company’s continuing need for the position, and (2) its incumbent’s performance. In addition, a “permanent” employee may be separated at any time without assigning any reason with 30 days salary (ref: section II.6.iii).
Temporary Employee: a person who has been employed for work that is essentially of a temporary nature. A “temporary” position is on that is likely to continue for a specific period. A temporary employee shall no be employed for more than two years under a single contract. The duration to la single contractual employment in SMC shall not be more than two years. A temporary employee after completing a contract, may be given a new 2 year contract based on (1) . The company’s further need for the position’s function; and (2). Demonstrated good performance of the incumbent.
Casual employees: a person who is employed on a day to day basis and paid a fixed daily wages as determined by the Management from time to time.
A part time employee is a temporary employee who is appointed to work for a specified number of hours that is less than normal working hours as determined by the company from time to time
All persons appointed against a permanent position are required to serve a period of probation. Internal promotion is not subject to probation.
The period of probation shall be 6 to 12 months in accordance with the grade of the position as follows for all new recruitment:
|Position||Initial Probation Period||Maximum Extension Period|
|Division Head||6 months||6 Months|
|Head/manager/executive/officer||6 months||6 months|
When an employee completes his/her probation an evaluation report on him/her will be sought by the human Resources Department from the Supervision or the employee.
- If the supervisor does not consider the employee fit for confirmation, he/she can recommend either (1) that the probationary employee’s appointment be terminated ,or (2)that the probationary period be extended for an addition 3 to 6 months depending on the position’s grade.
- The employee is confirmed in services only after the Supervisor reports in writing his/her satisfaction with the performance during the probationary period.
- A new employee ,upon confirmation, is entitled to be a Member of the Contributory Provident Fund, and to other benefits reserved for confirmed staff only(ref: Section IV.3)
- No salary adjustment will be made at the time of confirmation. However, the confirmed employee shall be eligible for an annual increment if he/she has served at last six months following confirmation during the last evaluation period. (ref: Section IV .2(b)iv)
Promotion is an upward advancement to a position in the next higher grade with same or additional responsibilities.
- In general, an employee shall be for promotion if he/she has a satisfactory service record and consistent good performance scores in the annual appraisal, and has worked in his/her present position for at least 5 (five) years.
- An employee with an outstanding service record and performance score in the annual appraisal will be eligible for fast tract promotion, which does not require a minimum time in position or grade.
- The promotion of all employees below the level of manager will be reviewed and recommended by a committee formed by the (head of human resources & legal matters) and appointed by the managing director. The committee’s recommendation requires final approval of the managing director to take effect.
- The promotion of head of the department / managers must be recommended by the division head and approved of the managing director.
- In general, promotion cases will be considered after the completion of the annual performance evaluation and will be effective from the date mentioned in the promotion letter. An exception to this annual timing can be made if required to further the objectives to the company.
- Promotion to a position shall entail placement at the next higher step over currently drawn salary and then fixed in the suitable step in the recommended salary grades.
- All promotions shall be made on the basis of merit of each case and no employee shall have a claim to be promoted to any particular post or grades.
An employee shall retire from the service of the company on completion of 60 (sixty) years of age. In an exceptional case, however, he/she may be employed afresh for a period not exceeding two years from the date of retirement on contractual basis, and company’s policy on contractual employment will apply. Such a contract will be awarded only once.
Resignation from service:
An employee leaving the service of the company is required to give 30 days notice or surrender 30 days salary in lieu to the company.
Termination of service:
The service of any permanent employee may be terminated without assigning any reason within 30 days salary in lieu of notice.
Discharge from service:
An employee found unfit for service because of physical or mental incapacity, or of continued ill health, or because of gross misconduct may be discharged at any time.
Dismissal from service:
The service of any employee may be dismissed by SMC for misconduct. (Ref: section III.1.)
Though not mandatory, all outgoing employees shall normally be requested to sumit to an exit interview. The head of human resource & legal matters shall conduct the meeting at a mutually convenient time.
The employee on separation is entitled to the following benefits:
- Contributory provident fund
- Encashment of annual leave if due
The employee is entitled to no other termination benefit unless exceptionally authorized by the board of directors.
SMC maintains a compensation package that, within the limits of its financial resources, can attract and retain persons with the qualifications and expertise best suited to the requirements of the job, as well as to the organization as a whole.
The basic compensation package consists of:
- Salary (basic salary, hours rent, medical allowance, and conveyance allowance where applicable)/ wages
- Employees’ provident fund
- Hospitalization & Group Insurance Benefits
- Gratuity scheme
- Festival bonus
- Annual leave encashment
The productivity-based supplements to the basic compensation package include:
- Performance incentive for sales support staff
- Sales incentive for direct sales staff
Employees’ provident fund
All the confirmed employees of SMC are entitled to become a member of Provident Fund. Every month 10% of the basic salary of an employee is contributed to the fund along with the same amount from the company’s account. Net income of the fund each year as on 31st of December is ascertained and interest is credited to the members’ account at a rate determined by the trustees. Any member, who has not completed three (3) years of continuous service, will not be entitled to get any portion of company’s contribution.
|Completed years of continuous service||Employee Contribution||Company Contribution|
|Less than 4 years but not less than 3 years||Full||50% of company contribution|
|Less than 5 years but not less than 4 years||Full||75% of company Contribution|
Hospitalization & Group Insurance Benefits:
|Benefit||Sub Group 1|
|Sub Group 2|
| Sub Group 3|
(DM – Officer)
|Sub Group 4|
|Maximum Hospitalization Benefit per insured per disability (A+B)||BDT 150,000||BDT 80,000||BDT 60,000||BDT 45,000|
|(A) Room & Board total limit per Disability||BDT 60,000||BDT 30,000||BDT 24,000||BDT 20,000|
|Room & Board Daily Limit||BDT 2,500||BDT 1,500||BDT 1,150||BDT 1,000|
|Daily Intensive Care Unit (ICU) No of Days Limit per disability||14 Days||14 Days||14 Days||14 Days|
|(B) Other Hospitalization Expenses/Services Total Limit per Disability (includes Surgeries, Medicine, Enesthesia, Doctor Visit etc. during Hospitalization)||BDT 90,000||BDT 50,000||BDT 36,000||BDT 25,000|
Benefits (same for all level)
Basic X 36 = XXXXXXX (maximum limit is BDT 2,100,000)
For Accidental Death: BDT 4,200,000
Gratuity is provided to all permanent employees on basic pay. It will be admissible to an employee, who has rendered continuous services to the company for a period of seven (7) years and more and 1 month basic pay is given for each year of services. Completed year of service for this purpose means twelve (12) months of continuous service.
- All employees shall be entitled to two festival bonuses, one prior to Eid-ul-Fitr and one prior to Eid-ul-Azha. Each bonus will be equivalent to two month’s current basic salary of the employee.
- To be eligible for the bonus an employee must work in the Company for at least six months or must be confirmed in his/her services of the Company, whichever comes first.
- Casual and part-time employees are not eligible for festival bonus.
- An employee who voluntarily leaves the Company is not entitled to a festival bonus that may be due immediately after his/her separation.
- An employee who is not in service of the Company at the time of Eid-ul-Fitr/Eid-ul-Azha will not be entitled to festival bonus.
Annual Leave Encashment
The Company shall allow its employees to en-cash unavailed leave from their annual leave entitlements as follows:
- Employees with less than three years of service with the company can en-cash unavailed annual leave up to a maximum of 8 days every year during their service with the company.
- Employees having three or more years of service with the company can en-cash unavailed annual leave up to a maximum of 10 days every year during their service with the company.
- The rate of payment will be based on the last drawn basic salary of the employee.
Employee Leave Policy
The employees of SMC are entitled to the following types of leave:
Employees are entitled to 25 days annual leave in a year.
Medical Leave- Absence cause due to the personal illness or injury is adjusted from an employee’s Medical Leave Entitlement.
Maternity Leave- Female employees are entitled to avail maternity leave as per the following guidelines:
- All female employees are entitled to avail 90 (ninety) days of maternity leave with full pay. Under special circumstance, leave may be extended (without pay) on request with the support of the supervisor and approved by the department head.
- Maternity will be granted only twice during the entire period of service of an employee. Necessary supporting papers must be provided in this regard.
Paternity Leave- Male employees are entitled to avail paternity leave as per following guidelines:
- All male employees are entitled to avail 3 (three) days of paternity leave per child.
- Paternity will be granted only twice during the entire period of service of a male employee.
- Paternity leave days may be avail before or after child delivery or in combination of days before and after delivery.
Bereavement Leave- In the event of the demise of employee’s spouse, child, parent, an employee may be granted Bereavement Leave upto a maximum 5 (five) days in a year.
The individual performance incentive recognizes an employee’s extraordinary contribution to increasing the company’s productivity and effectiveness in pursuit of its objectives. It is intended to encourage and reward individual performance that EXCEEDS THE PERFORMANCE STAARDS NORMALLY EXPECTED of the employee. The performance standards that must be exceeded are:
- Individual- those standards incorporated in the employee’s job description, and specific goals.
- Collective – the attainment of the total cost recovery for the company as a whole and for specific field offices.
Any employee whose overall performance for the year is rated as “very good or above” in the annual performance review is eligible for the “individual” component of the performance incentive. Any head office or sales area based support staff whose overall performance for the year is rated as “fully satisfactory “in the annual performance review is eligible for the “collective” cost recovery component of the performance incentive. This includes employees who were in their probationary period during part of the year.
For all direct sales staff, performance incentives will be earned on the basis of the sales incentive scheme proposed in the annual marketing plan and approved by the board.
These staff will not be eligible for the national or area based “collective” total cost recovery component of the performance incentive.
Fixing the size of the performance incentive
Each year’s annual performance incentive is allocated from that year’s increased sales revenues over the total sales revenues for the previous year. Accordingly, the total amount available for the annual bonus is not fixed, but will vary according to the company’s sales performance during the year. This will be approved by the board of director from time to time.
Before the start of each fiscal year, the managing director and the division head will determine the total amount available for the year’s annual achievement incentives based on the year’s projected increase in sales revenues over that of the previous year. The total amount will reflect a prudent balance between the company’s needs to reward employees whose performance exceeds expectations, and to meet its corporate financial objectives. The total amount to be allocated to the annual performance incentive is subject to the approval of the board of directors. It will be submitted to the board as an element of the budget submission for the upcoming fiscal year.
The managing director, in consultation with the division head will allocate the incentive money among the divisions.
For head office and area office based support staff (other than senior sales manager/sales manager/AE and sales driver), the potential maximum incentive amount for each individual employee will be fixed at the average of two months FY2002 gross salary of the employee’s category. This fixed incentive amount may be reviewed at intervals of every two years, e.g. 2004, FY2006, FY2008, etc. any future increase in the incentive amount would be a percentage increase of this initial(i.e. FY002-based) fixed amount.
For direct sales staff, (sales officers and sales promotion officer) the amount of the incentive will be fixed and proposed for approval by the board. This fixed incentive amount may be reviewed at intervals of every two years, e.g. 2004, FY2006, FY2008, etc. any future increase in the incentive amount would be a percentage increase of this initial fixed amount (see below, section b. iv).
For senior SM/SM, AEs and Company Sales Driver, the incentive amount will be a fixed amount calculated on the basis of a fixed percentage of the amount for SOs and SPOs (described later) and approved by the board. Their incentive amount (this fixed percentage figure) in future will change with the increase in the amounts for the SOs and SPOs.
Performance Incentives on individual component for Head Office Staff will be withdrawn if the total sales revenues earned falls below 90% of the annual target. For field staff (other than direct sales staff but including Sr. SM/SM, AEs), the individual incentives will be withdrawn if the sales revenues falls below 90% of the annual target, individual amounts on performance will be proportionately adjusted downwards.
Types of Performance Incentive Award
There are two types of Performance Incentive Award Scheme:
- Sales Support Performance Incentive (Head Office staff, and Sales Office-based Staff);
- Sales Incentive for all direct sales staff.
A Performance Incentive Committee administers the award of individual performance incentives. The Committee consists of five members nominated by the Division Head and appointed by the Managing Director to two-year terms. The Head of Human Resources & Legal Matters serves as the Committee’s Secretary. The man functions of the Performance Incentive Committee are;
- To review the individual performance incentive recommendations submitted by the Head of Human Resources & Legal Matters (ref: Section VI.(c) iii-v) ;
- To review individual performance targets mutually agreed to by the employee and his/her supervisor to ensure that the threshold for “outstanding” performance truly exceeds the normal expectations for the position:
- To review the distribution on performance appraisal scores to identify patterns of bias (too high or too low) in the ratings of supervisors.
Administration of the performance incentive award for head office and sales office-based support staff
The performance incentive for sales support employees is intended to encourage and reward high performance ABOVE AND BEYOND THOSE NORMALLY EXPECTED in an employee’s specific area of work.
An employee whose overall performance for the year is less than completely satisfactory s not eligible for a sales support performance incentive award. The performance incentive award will be administered as follows
- The annual performance review discussion between an employee and his/her supervisor will include consideration of any work achievements during the review period that exceeded the performance standards that the employee is expected to meet. If mutually agreed between supervisor and employee, these are recorded in the standard individual achievement form that describes the achievement and serves as a recommendation for the award. This recommendation, together with the annual performance review, is submitted to the head of human resource & legal matters.
- The head of human resource & legal matters reviews each recommendation for a performance incentive against the employee’s normal performance expectations. This review may include further discussion with the supervisor and employee as needed. If the head of human resource & legal matters disagrees with the recommendation, he/she will communicate this to the supervisor and employee with an explanation for its non-acceptance. If the head of human resource & legal matters agrees with the recommendation, he/she will forward it to the performance incentive committee for review.
- The performance incentive committee will communicate its agreement with a recommendation to the head of human resource & legal matters, who will, in turn, record that agreement in the employee’s personal file and arrange for he payment of the award to the employee. If the committee disagrees with the recommendation, it will communicate its reasons in writing to the supervisor and employee, copying the head of human resource & legal matters.
- Of the total performance incentive amount, 25% will be awarded only on the attainment of total cost recovery in the national or regional/area as applicable. The remaining 75% will be awarded for individual performance.
The following table summarizes the eligibility requirements for head office and area based sales support staff:
|Level of achievement|
|Every goal met on deadline and quality exceptional. Additional initiatives taken and completed. Rated as “outstanding” in performance appraisal.||75 % of fixed incentive amount||25 % of fixed incentive||100 % of fixed incentive amount|
|Every goal met on deadline and quality acceptable.. Rated as “very good” in performance appraisal.||50 % of fixed incentive amount||25 % of fixed incentive||75 % of fixed incentive amount|
|Most high priority goals met by deadline with acceptable quality. Rated as “satisfactory” in performance appraisal.||Not eligible||25 % of fixed incentive||25 % of fixed incentive amount|
|Most goals not met by deadline and/or quality of work is unacceptable. Rated as” not satisfactory “in performance appraisal.||Not eligible||Not eligible||None|
- The level of performance achieved by an individual employee will be determined by the score rate by an employee on his/her annual performance appraisal and measured against the predetermined composite score range for awards for level of performance.
- Incentive for the area sales staff who support all area offices within region (i.e. Sr. SM/SM, HT&CI Officers and MVU Staff) will be tied to area sales targets and individual performance.
Fixation of incentive amount for Sr. SM/SM/AE and Sales Driver
The calculation of the potential maximum incentive amount for all staff mentioned above will vary by category of staff. These fixed incentive amounts may be reviewed at intervals of every two years. For the period FY2003-2004, the total performance incentive amounts for these sales support field staff has been fixed as follows:
|Area executive||5% over the average of the sales officers and sales promotion officer’s incentive amount combined.|
|Sales manager||10 % over the average of area executive’s incentive|
|Sr. sales manager||10 % over the average of sales manager’s incentive|
|Sales driver||50 % of the incentive amount of sales officer’s incentive with whom the driver is attached.|
The following table summarized the eligibility requirements for the sales incentive for sales support field staff:
|Level of achievement|
|Every goal met on deadline and quality exceptional. Additional initiatives taken and completed. Rated as “outstanding” in performance appraisal.||75 % of fixed incentive amount||25 % of fixed incentive amount||100 % of fixed incentive amount|
|Every goal met on deadline and quality acceptable.. Rated as “very good” in performance appraisal.||50 % of fixed incentive amount||25 % of fixed incentive amount||75 % of fixed incentive amount|
|Most high priority goals met by deadline with acceptable quality. Rated as “satisfactory” in performance appraisal.||0 % of fixed incentive amount||25 % of fixed incentive||25 % of fixed incentive amount|
|Most goals not met by deadline and/or quality of work is unacceptable. Rated as” not satisfactory “in performance appraisal.||0 % of fixed incentive amount||0 % of fixed incentive||0 % of fixed incentive amount|
The level of performance achieved by an individual employee will be determined by the score rate by an employee on his/her annual performance appraisal and measured against the predetermined composite score range for awards for level of performance.
Sales incentive for direct sales staff
This incentive scheme is for those employees who are directly involved in the implementation of sales targets. They include sales officer/executive, sales promotion officer/executive.
This sales performance incentive for the different categories will operate on the basis of the following principles-
- Targets for sales officers are base on individual brand volumes, CYP and Revenue, and may also include other sales related criteria such as effective calls, outlet coverage etc. depending on the need to improve such performance.
- Targets for sales promotion officer will be based on both qualitative and quantitative measures such as doctor visits and their impact, seminars/workshops, inject able administrations, and condom sales to selective outlets.
- The concerned division head and head of sales will fix the criteria incentive amount for each criterion at the beginning of the financial year. These will be proposed in the marketing plan for approval of the board.
- Incentive for direct sales staff can be earned at only two level of achievement 10-105 and 106%
The maximum incentive amount for each category of direct sales staff for FY 2003 has been approved as follows:
|Categories of staff|
|Sales officer||0||Tk. 44,000||Tk. 58,000|
|Sales promotion officer||0||Tk. 41,000||Tk. 54,000|
|STD/AIDS program officer||0||Tk. 15,000||Tk. 20,000|
The percentage by which the objectives achieved must exceed the targets fixed for the year may very depending on the challenge and difficulty associated with the achievement of the projected sales targets/objectives for the various brands and products sold. This percentage may vary from year to year to reflect the company’s annual sales strategy and objectives.
- Direct sales staff will not be eligible for incentive on national or area based cost recovery.
Each employee is personally responsible for following the company’s work rules.
Types of misconduct
Employee behavior that is inconsistent with the faithful discharge of his/her duties is considered to be misconduct, and is grounds for disciplinary measures that can be imposed by the employee’s supervisor. The following acts and omissions shall be treated as misconduct:
- Willful insubordination or disobedience of a superior;
- Theft, fraud or dishonesty in connection with company business or property;
- Committing, r involvement in, an act of bribery or any illegal gratification for personal gain;
- Habitual absence, or absence without leave for more than ten days;
- Habitual late attendance;
- Breach of any law or rule or regulation of the company;
- Riotous or disorderly behavior in the company;
- Habitual negligence or neglect of work;
- Resorting to illegal strike or ‘go-slow’;
- Falsifying, tampering with, damaging, or causing loss of company ‘s records or property;
- Conduct unbecoming of an employee of SMC;
- Any act subversive of company’s interest;
- Conviction for any criminal offence in the court.
- Sexual harassment (*deliberate offensive comments, gesture/physical contact of a sexual nature in work or work-related environment; * influencing or offering to influence, or threatening the pay or career of another person(male or female), in exchange for sexual favor)
- Receiving any gift or/and favor from any person/organization which effect the performance of official duties of an employee;
- Formation of any kind of association in the company which will effect the performance of official duties of an employee.
Penalties for misconduct
An employee, if found guilty of misconduct, may be given any one or more of the following penalties depending on the gravity of offence, past conduct, and any other relevant circumstances:
- Dismissal from service
- Discharge from service
- Withholding of increment or promotion or both
- Non-payment of incentive for a specific period
- Suspension for 7 days without pay
- Warning letter
Summary of findings
Based on my personal observation and the results from the questionnaire, the findings are as follows
- SMC has very little training and development policy for new recruits. We find that 80 % answered positively and 20 % answered negatively in this regard in paper they are supposed to give on the job training and job orientation, but in reality this is not happening very often.
- About 75 % of the employees were satisfied with the performance appraisal system. Among the rest of the respondents, 10% were neutral and 10% said the performance appraisal system was bad and 5% said it was worst.
- 30% of the employees were somewhat satisfied and 10% were very satisfied with the promotion policy of SMC. 35 % employee satisfaction level Neutral. This indicates that SMC HRM is doing a good job in this aspect. However, some employees suggested that the promotion should be based on performance and an employee’s recent up graded Knowledge or new training or publication or new degree should be acknowledged for the necessary promotion.
- Form the survey findings, 80 % of employees were some satisfied and 10 % of the respondent extremely satisfied with the recruitment and selection policies of SMC. Very good news for SMC is that 70 % of the employees said SMC practices a sound recruitment and selection policy.
- Most employees felt pay scale needed to be improved and updated. only 40% were somewhat satisfied with the pay scale
- From observation it seemed there is a lack of communication between employees and management and between employees and employees.
- SMC is a reputed Company, But it is not doing very much to enhance its image, some staff felt that SMC can do more to enhance their image.
- Dynamic executives are working in different department & branches
- Increasing Sales network day by day.
- SMC covers more than 220,000 outlets each year directly through its sales network.
- Global network
- 38 years of operation in Bangladesh
- Highly qualified people both Head Office & different branched
- Cross-cultural experience
- SMC’s telephone hotline – “TeleJiggasha” programme provides correct reproductive and health information, problem faced by the youth.
- SMC sponsors and conducts a number of research studies to gather empirical data and necessary information in developing and evaluating its various projects and activities.
- Conducts intensive training of front-line health providers through its nation-wide Health Providers’ Training Program (HPTP).
- Follows global HR system to make the business more smooth and competitive • Compliant towards business “ Highest performance with Highest Ethic”
- Long chain of command & authority
- Long lead time for decision making by Board
- Potential pool of people
- Prosperous business market
- Directors are popular in their field.
- Huge competition from others Marketing Company
- Others Branding Companies has provided huge amount of Commission to the Parties.
The SWOT analysis has been done to find out the internal and external weakness and strengths of organization. SMC has a strong strength in their innovations in shaping up the future of the world with the aim of enhancing the living standards
SMC follows strong and healthy HR policies which not only focus on human resources but also consider organizational goal while developing any human resource strategy. SMC has a flatter HR structure which faster the speed of doing business more efficiently and effectively. Even though with such effective HR structure and policies, still there lays merits and demerits and hence provide a scope of improvisation for better organization.
The HR system of SMC very much organized and specific in terms of policies and strategies for dealing employees and other parties both inside and outside of the organization. The HR policies and strategies are pursuing to ensure that the recruiting, selecting, training, appraising and compensation systems are consistent with the company’s strategic plan. As said by a writer that in a growing number of organizations human resources are now viewed as a source of competitive advantage. A high quality workforce enables organization to compete on the basis of market responsiveness, service, quality, behavior, liaison and technological innovations.
With the difficulties of any one to analyze any HR practices of any organizations and to recommend anything’ regarding this purpose. But the sign of encouragement, from my honorable coordinator, has helped me a lot to recommend something on this policy. So far I am accumulating the information; I have identified some drawbacks of recruitment policy of SMC. My documentation is based on these drawbacks. My intention was evaluating the whole recruitment procedure constructively.
After survey 24 employees of SMC that they provide me honest, thoughtful, recommendation and candid feedback which are given below:
- Qualified and professional employee should be recruited for the company to reach the organization in the competitive market.
- Avoidance of written test in most of the cases SMC prefers short listing. Viva voice to evaluate the competence of often individual candidate. Very few times, they use the device of written test to find out the creditability of the candidates. Had this device been device been used successfully, the authority would have been to catch up the potential of the applicants more effectively Department wise in house Training should be required for every employee after 02 months for perform the job accurately.
- Policy of Performance Appraisal System of the company should be utilized by the Departmental In-Charge properly that will brings effective judgment for the employee.
- Recruitment & selection process should be done on merit basis. Recruit desk personal after considered the academic background and having release order from previous company and for marketing person proper cost analysis should be maintained according the company policies.
- Job Related Training will be required for all employees that will increase the capacity of employees effectively and efficiently.
- Human resources department monthly meeting will be needed that will brings valuable guidelines for all department activities.
- Communication is required with the employee on their Birthday, Marriage day or any others Sad or Happiness day that will brings employees confidence and morality.
- From a HR point of view, it is HR utmost duty to provide training to the employees not related to their job only but also training which can help the employees to develop personally. Training will make the employees specialized in their respective tasks which will enable them to perform better and hence will lead to high organizational performance or vice versa.
- Compensations & benefits are also related to organizational performance. Good compensation and benefits package enhance employees to perform better in their task. There is more chance for the employees to be more devoted towards their work and hence will lead to the achievement of organizational goals.
- Performance appraisal is one of the most important steps in the HR process. It is very important to review employee’s performance and provide time to time promotion and increments. Performance review enhances employee’s motivation and job satisfaction.
On balance we can conclude that SMC HR must undertakes the needful actions to keep healthy relationship with the employees. If required HR must makes necessary correspondences with the management. HR must plays a vital role as a shrink and motivator of the employees to reduce any situational or psychological discomfort if anyone come across in their day to day work. Along with monitoring and guiding the total workforces, Human Resources Department of SMC may assist the employees to achieve their given individual target as well as moving towards the organizational goals.
Thus I can finally conclude that if SMC follows the proposed HRM practice and style they will get better competitive advantage and will be able to achieve its target more effectively and efficiently in Future.
Questionnaire HR practices of SMC
This survey provides feedback on the HR practices of SMC. It is important that you provide honest, thoughtful and candid feedback. This survey is anonymous and your responses will behold in the strictest confidence.
Please answer all the questions and tick the appropriate box.
Length of service at SMC:
Do you think SMC practices a sound recruitment and selection process to attract qualified job applicants?
Yes_________ No ___________
Would you personally recommend qualified applicants to apply to SMC?
Yes_________ No ___________
Does SMC have a good training and development policy?
Yes_________ No ____________
How would you rate the performance Appraisal system off SMC on a scale of 1 to 5?
Are the objectives and policies of performance appraisal system communicated to employees?
Does the performance appraisal system accurately measure employee performance?
Yes __________No ___________
How satisfied are you with the recruitment and selection policy of SMC?
- Very dissatisfied
- Somewhat satisfied
- Extremely satisfied
How satisfied are you with the pay scale of SMC?
- Very dissatisfied
- Somewhat satisfied
- Extremely satisfied
How satisfied are you with the training and development policy of SMC?
- Very dissatisfied
- Somewhat satisfied
- Extremely satisfied
How satisfied are you with the performance appraisal system of policy of SMC?
- Very dissatisfied
- Somewhat satisfied
- Extremely satisfied
What is the basis of evaluation performance appraisal system of the employees of SMC?
- criteria job related
- very complicated procedure
- Supervisor based.
- Management giving importance to the performance appraisal system.
Is the performance appraisal system based on confidential reporting?
Yes__________ No __________
How satisfied are you with the promotion policy of SMC?
- Very dissatisfied
- Somewhat satisfied
- Extremely satisfied
Which area of Human resource of SMC is most weak and needs to make major changes?
- performance Appraisal system
- Other Pleas specify _________
Overall how satisfied are you working In SMC?
- Very dissatisfied
- Neither satisfied nor dissatisfied
- Somewhat satisfied
- Extremely satisfied
- What would you recommend SMC do to Improve their HR practices?